Copshots.com - A Cautionary Copyright Tale

Posted on 1/4/2008 by Jim Pickerell | Printable Version | Comments (1)

Even if you handle copyright correctly, getting compensated once there is an infringement can be difficult.

In March 2005, Hans Halberstadt got a call from a potential client in Sweden asking for a price for one his images. The client wanted it for a banner in a trade show. The image was found on Hans' Web site: www.militaryphoto.com. The client sent Hans a PDF of the design as an aid to establish a price, and Hans discovered that instead of a single image, the design contained three of his photos.

Since he has never authorized anyone else to license rights to his images, he immediately asked where the client got the other two. The client had bought them from Copshots.com.

After checking further, Hans discovered that several hundred of his model-released images were being offered for sale on Copshots. All had been bulk-registered and most had his copyright information in the IPTC header.

The first step was to determine how Copshots got the images.

Hans had worked with a production manager when these images were produced and had given the production manager copies of the files for his own portfolio. The production manager had been contacted by Copshots for images they could use in their new stock photo business. He sent them a disk with his images. On the same disk were the Halberstadt images. He told Copshots that the disk included only some usable images; others were off-limits. Still, all the images ended up on Copshots.com.

Soon after his discovery, Hans contacted Copshots and spoke to CEO Jonathan Grace. Grace was initially very courteous and helpful. He acknowledged that he had over 300 of Hans' images on the site, insisted there had only been "a dozen or so" sales and immediately pulled the images off. At that point, Hans would have been willing to settle for a few thousand dollars but wanted to review sales records and download logs. Grace refused to supply records relative to what had been licensed or downloaded.

Then the attorney duel began. Grace hired an attorney. After months of fruitless negotiation, in May 2005, Hans filed a suit at the U.S. District Court for the Northern District of California. The judge forcefully encouraged the parties to settle the case and assigned them to a magistrate who scheduled a settlement conference.

After much wrangling before the magistrate, it was finally agreed that Grace would pay Hans $20,000 in $500-a-month installments. If he failed to make a payment in any month, the total owed would rise to $50,000 minus anything already paid and be due immediately. Grace made three payments and then notified Hans that he was broke and didn't intend to pay any more.

At this point, it became necessary for Hans to hire a different attorney who specialized in

collections in an effort to recover the balance owed. It is important to note here that Hans lives in San Jose, near San Francisco, while Grace (despite his claim of poverty) lives in a gated community on a golf course in Orange County,  south of Los Angeles.

To collect, it was necessary to bring Grace into court again and to accomplish that, the law requires that the defendant be personally served with a subpoena. Grace ignored the first debtor examination hearing date, resulting in a second subpoena being issued and a new hearing date.

Grace showed the second time, but didn't bring the records the judge had required. A new trial date was set, which Grace ignored. Finally, after a fourth subpoena and examination of his wife, Grace agreed to pay Hans $20,000, which has been paid.

In addition to attorney's fees and the costs in preparing for the settlement conference, Hans was required to make four trips to Orange County for the four hearings there.

Total costs for him are estimated at well over $10,000.

Lessons Learned

1. Register the copyrights to your work before it is shown to anyone and in advance of infringement.

2.  Be sure to put all your copyright information in the IPTC header of the digital file including your contact information.

3.  Before contacting an infringer, make every effort to document the infringement. (The fact that the infringer pulled everything down immediately, made it more difficult to prove the infringement later.)

4.  Make every effort not to go to court. Try to find some reasonable compromise.

5. If you use an attorney, find one who understands copyright law.


Copyright © 2008 Jim Pickerell. The above article may not be copied, reproduced, excerpted or distributed in any manner without written permission from the author. All requests should be submitted to Selling Stock at 10319 Westlake Drive, Suite 162, Bethesda, MD 20817, phone 301-251-0720, e-mail: wvz@fpcubgbf.pbz

Jim Pickerell is founder of www.selling-stock.com, an online newsletter that publishes daily. He is also available for personal telephone consultations on pricing and other matters related to stock photography. He occasionally acts as an expert witness on matters related to stock photography. For his current curriculum vitae go to: http://www.jimpickerell.com/Curriculum-Vitae.aspx.  

Comments

  • Gerald Bybee Posted Jan 7, 2008
    Jim,

    This is a great post and excellent example.

    I have had to defend several of my own copyrights against unlicensed use and even copying by a fellow photographer. It is never easy or fun, and results in a lot of frustration and expense. The first time, many years ago, I won a judgement against a publisher who thought he could take advantage of a young, eager self-employed photographer. But I was never able to collect the judgement and realized the expense of trial and collection was far more than the damages I was awarded and then never collected. I have to hope it at least taught the publisher not to exploit artists. It certainly taught me a valuable business lesson. In later cases I learned how to be firm, use an experienced legal firm, but to settle as quickily as possible in order to come out ahead. consequently never wound up in federal court and was able to collect some compensation for the infringement. In several instances I was able to license the image for further use and came out way ahead than if I had insisted on extracting statutory damages through federal court. From my perspective the only parties to realize bottom line profit from litigation are the attorneys. Somtimes that is called for but often the expense can be avoided.

    Now much later in my career, I have been asked to do some consulting and have worked as an expert witness on several photographic cases. I've seen how much time and money is spent on attempting to prove copyright infringements and win damages. Sometimes the photographer has tried to do things right, sometimes the alleged infringers have genuinely made an honest mistake but even then it is difficult to arrive at a settlement unless both parties are reasonable. Your advice to settle is very wise as the time, cost and effort of going to Federal court are huge, especially for an independent or freelance photographer who often is seeking damages from a large corporation with in- house counsel or attorneys on retainer.

    It seems to me the key is being informed, doing things the best you know how, following the guidelines and recommendations of professional organizations like ASMP, APA, EP, PPA etc. and spending some money on good legal advice setting up, and implementing your own business practices, contracts and license agreements. Working pro actively with an experienced and ethical attorney is money well spent in my opinion.

    Then when a problem arises, do your homework, be professional, ethical and courteous in your negotiations and again get good legal advice.
    If you don't have an attorney look to one of the trade organizations for a referral or look to groups like California Lawyers for the Arts or other local non-profit legal referral groups in your respective state. Even then it is appropriate to treat the process as a business proposition and realize there may be the unscrupulous business person out there who will attempt to avoid obligations. Then it comes down to ethics and bottom line. Is it worth the battle? Sometimes it is and if the photographer is fair and ethical in his demands and works professionally within the system it can be worthwhile not only for the individual photographer but also for the photo and art community. Conversely however, if the photographer is unreasonable, greedy, or unethical it can damage the reputation of the photographic community and create some bad karma for the individual even if the photographer was in the right to begin with. Two wrongs don't make anything right.

    There recently was a case reported in PDN where a photographer and his attorney attempted to take advantage of an infringement, inflated the damage demands beyond proportion, and refused reasonable settlement offers from the infringer. The courts ruled the photographer, despite being infringed, had to pay legal fees, costs and damages for deliberately trying to take unfair advantage of the system and earn unfair compensation.

    The point to all this is that defending a copyright is never easy even if the artist has registered a copyright and is clearly in the right.
    The best bet is to do everything to limit or avoid the litgation whenever possible and above all be professional and be ethical in all your dealings! There is much to be said for legal karma IMHO.

    GB
    www.bybee.com/expert

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